I had no clue why that should happen because (as I already said) I was logged in as the administrator.
It looks like Notepad also has to be run as an administrator if you wish to make changes to a system file. So, here’s what solves the problem. Step 1: Search for Notepad from the Start menu or navigate to a place where you might have pinned it. Right-click on the .exe and choose to Run as administrator.
Step 2: Open the desired system file from this instance of Notepad by using Ctrl+O (for me it was my Hosts file), make your changes and hit Ctrl + S. Your changes should save without any error or problem. Hope that helps.
